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Berkshire Hathaway Inc. Message Board

  • hjclasvegas6969 hjclasvegas6969 Dec 8, 2013 11:00 PM Flag

    hussman, The Truth Does Not Change According To Our Ability To Stomach It

    bonds vs stks.

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    • His estimate that the prospective nominal annualized total return for the S&P 500 over the next decade is likely to be 2.3% works for me.

      I get 2.1% using the following assumptions: buy today at 160% of sales, sell ten years from now at 100% of sales, and, during that decade, sales grows 4.5% per year and one collects a dividend each year equal to 3% of sales.

      • 2 Replies to jad1148
      • seems like some reasonable assumptions there, I don't doubt that this probably will end up being an expensive time to own equities. However, Hussman didnt have any equity exposure in early 2009 (although he did for a brief time in 2008) when equities sold for a p/s of 0.8 or even in sep 2011 when the p/s was a fairly reasonable 1.1. I think you need to be very careful at this time especially but in general I tend to agree with WB that the risks of being out of the game are huge compared to the risks of being in it.

      • morning jad, think about this. buffett and iCON both love buybacks right ? 2 kids with pretty good long term track records, right ? if 499 spy stocks all said we intend to use 50 % of our free cash flow to buyback our stock for the next 10 years, would hussman's stock price expectations change going forward ? would yours ? if yellin said im not raising interest rates until hillary is elected, AFTER 2016, would that matter ? does supply and demand matter ?

 
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